Federal Home Loan Mortgage Corp (OTCMKTS:FMCC) has revealed that interest rates on 30-year mortgages fell to their lowest, in more than a year. The week saw the average mortgage rate on 30-year loans to fall to 3.59%, from 3.71% during the preceding week. The agency also revealed that this is the lowest the rate has fallen in the current year, but is similar to that during February of the preceding year.
Sean Becketti, the chief economist for FMCC, revealed that the low mortgage rates and a positive outlook from the employment sector could possibly translate to a strong housing market, during the 2Q2016. However, this has also been affecting treasury yields, which have been declining for quite some time now. The treasury has also been warned, by the Federal Reserve Chairperson, Janet Yellen, who stated that the treasury should be cautious about raising interest rates.
It should be noted here that the current period is considered to be the peak for home buying and reduced borrowing costs are likely to attract more customers. As such, the 15-year rate has also declined on average from 2.98% to 2.88%. Some analysts are of the opinion that doing so during the peak buying season would mean additional upward pressure on prices. The main reason for this is the fact that there is a shortage of homes in the market. If this should happen, buyers could very well be looking at a revision of interest rates from the Feds, very soon.
In addition to lowering the borrowing rates, the FMCC also revealed plans to launch a new collaboration platform, which would help make the housing counseling industry more efficient. An agreement in this regard, has been reached with Home LoanPort. As per the details of the application, FMCC plans to reduce the time counselors spend on administrative tasks, so they can better guide borrowers and potential buyers.
Federal Home Loan Mortgage Corp (OTCMKTS:FMCC) recorded a decline of 1.18% in its share value, to reach a close at a share price of $1.26, at the end of the April 8 trading session.